| The Small Business Administration (SBA) is | | | | every State. A loan guarantee from SBA gives |
| the first place every start-up business | | | | a bank the added security it needs to lend |
| person and entrepreneur thinks they should go | | | | you money. If the borrower's business doesn't |
| for small business grants. There is good and | | | | get off the ground as quickly as planned and |
| bad news on this: Yes, it is a great first | | | | the business ends up defaulting on the loan |
| place to go when you are starting your | | | | the SBA will repay all or part of the loan - |
| business because they provide free counseling | | | | usually about 40% of the loan will be |
| and financial assistance, however, the SBA | | | | guaranteed. |
| itself does not hand out free grant money to | | | | |
| start or expand a business. Anyone who tells | | | | This type of financial assistance may not be |
| you otherwise is mistaken, or pulling your | | | | as good as free grant money, but if it is |
| leg. | | | | money you can actually get your hands on |
| | | | reasonably quickly, on decent terms, and the |
| The SBA is an independent agency of the | | | | repayment schedule can fit within your |
| federal government and its purpose has | | | | budget, then it's a great deal and probably |
| remained the same since its creation in 1953. | | | | your best option as far as financial |
| According to their website the purpose of the | | | | assistance from the Small Business |
| SBA is "To aid, counsel, assist and protect | | | | Administration. If you need a line of credit |
| the interests of small business concerns, to | | | | at any point in your business start-up or |
| preserve free competitive enterprise and to | | | | expansion, be sure to check out these SBA |
| maintain and strengthen the overall economy | | | | resources. Keep in mind that even if in the |
| of our nation." The primary way in which the | | | | past you have been unable to borrow money |
| SBA does this is not by providing grants, but | | | | elsewhere, it doesn't mean you won't be able |
| by administering low interest loans, or loan | | | | to get business financing now. A loan |
| guarantees, which give small business owners | | | | guarantee from SBA will help you secure |
| like you access to start-up money from | | | | financing when it would otherwise be |
| private lenders all over the nation. These | | | | unobtainable based on your credit, perceived |
| are loans that you might not otherwise be | | | | ability to repay the loan and other factors. |
| able to get without the guarantee from the | | | | They also have programs and ways of |
| small business administration. The SBA does | | | | streamlining the application procedures |
| not directly provide you with small business | | | | necessary to provide financial assistance to |
| financing, they are an intermediary and they | | | | the small business community. |
| contract with private lending institutions in | | | | |